Battle for 3PAR One of the Most Prolific in Years

Hewlett Packardraised its bid for 3PAR to $30.00 a share, or about $2 billion on Friday. This comes after Dell matched HP's previously increased bid to $27.00 a share, valued at $1.8 billion earlier this morning.

Source: 3PAR.com

A person close to the HP camp tells me that Hewlett Packard continues to bid for 3PAR because it believes an acquisition is beneficial to its strategy, and not because it is trying to simply demoralize Dell.

As to why the company has been so incredibly quick in its response to Dell's raised offers, the source says HP is trying to keep pressure on 3PAR's board of directors, which it believes is pursuing a flawed strategy as it fileds the latest offers.

Why flawed? Well, 3PAR's board continues to allow Dell to simply match the latest offer from Hewlett Packard rather than exceed it, even though Dell is now owed a $72 million break up fee—meaning a Dell bid costs more for shareholders than an HP bid.

And, as for what has shaped up as one the most prolific auctions in recent years, keep in mind that 3PAR and its advisors had agreed to sell the company for $18 a share when there was clearly a far higher price out there.

JPMorgan Chase is HP’s investment bank on the deal, and Cleary Gottlieb Steen & Hamilton is its legal adviser.